As per our recent post, the American Rescue Plan Act of 2021 (“ARPA”) provides fully subsidized health care continuation coverage to certain individuals, among other things. Those who are eligible for the COBRA subsidy (“assistance-eligible individuals” or “AEIs”) include workers and their dependent family members who lost group health insurance coverage due to involuntary employment termination or reduction in hours, whether or not occasioned by the COVID-19 pandemic. Read more
The American Rescue Plan Act of 2021 (“ARPA”), signed into law on March 11, 2021, provides fully subsidized health care continuation coverage to certain individuals. These “assistance-eligible individuals” or “AEIs,” include workers and their dependent family members who lost group health insurance coverage due to involuntary employment termination or reduction in hours, whether or not occasioned by the COVID-19 pandemic. The subsidy applies to group health insurance plans subject to the Consolidated Omnibus Reconciliation Act of 1985 (“COBRA”) or comparable state continuation coverage. Employers subject to COBRA are those with at least 20 employees on more than 50 percent of its typical business days in the previous calendar year; smaller employers in states with “mini-COBRA” laws, such as Massachusetts, must also provide continuation coverage. The subsidy applies to health, dental, and/or vision insurance premiums; health flexible spending arrangements are not eligible for subsidies. The subsidy is not available to individuals who lost coverage for any reason other than those set forth above.
The subsidy is available for the six-month period from April 1 through September 30, 2021 only. Eligibility for the subsidy terminates if the AEI becomes eligible for other group health plan coverage or Medicare. AEIs are subject to penalties of up to 110% of the subsidy if they fail to notify the group health plan when they become eligible for other health care coverage. AEIs are not eligible for subsidies if coverage was lost due to employment resignation, termination for gross misconduct (which is a very high burden to meet), or other qualifying event (such as death of the covered employee, divorce, or legal separation). Read more
On May 18, 2020, the federal Department of Labor, Wage and Hour Division issued a final rule that expands the types of industries that may be able to take advantage of the overtime pay exemption for certain employees paid primarily on a commission basis. Specifically, the Fair Labor Standards Act (FLSA) includes an exemption from the obligation to pay overtime to employees who work more than 40 hours in a workweek if they work for a “retail or service establishment,” are paid at least 1.5 times the applicable minimum wage, and receive more than half of their total earnings for a representative period in the form of commissions. The term “retail or service establishment” is defined to mean establishments 75% of whose annual dollar volume of sales of goods or services (or of both) is not for resale and which are recognized as retail sales or services in the particular industry. Under long-standing Division regulations, some industries were identified as having “no retail concept” (29 CFR § 779.317), and this list was considered in determining which industries could not claim the exemption, while the WHD deemed that others “may be recognized as retail” (29 CFR § 779.320), and therefore could avail themselves of the exemption if the other requirements were established. Now that the DOL has withdrawn both lists, employers in a wide variety of industries—from accounting firms to laboratory equipment dealers to sign-painting shops to those selling window displays—should consider whether they may fit the definition of “retail or service establishment” and therefore can take advantage of a newfound flexibility in compensation for certain employees.
Over the last eight months, the DOL has issued several new final rules interpreting the FLSA, including:
- Updating guidance for determining joint employer status (January 16, 2020, available here);
- Changes to the calculation of the “regular rate” so that certain kinds of compensation no longer have to be factored into an employee’s rate for purposes of determining their overtime rate of pay (December 16, 2019, available here); and
- And, as we previously explained, updating the earnings thresholds for employees exempt under the administrative, executive, learned professional and “highly compensated employee” exemptions (issued September 24, 2019, effective January 1, 2020, available here).
Of note, the withdrawal made public on May 18th has immediate effect, without any notice and comment period or other delay.
 Certain retail or service establishments may be exempt from the FLSA altogether if they do not meet minimum thresholds for sale of goods or services in interstate commerce. 209 U.S.C. § 203(s), 29 CFR § 779.337.
By Bello Welsh LLP
- What safeguards should employers consider implementing to protect employees (and customers, visitors, and vendors) after state and local authorities allow non-essential businesses to reopen?
- Develop an infectious disease preparedness and response plan
- Identify a workplace coordinator responsible for COVID-19 issues
- Identify which workers, customers, individuals may be exposed (or transmit), or where within the work place such exposure/transmission may occur
- Develop contingency plans
- Increased rate of worker absenteeism
- Need for social distancing, staggered work shifts, and other exposure-reducing measures
- Need to modify existing supply chains
- Actively encourage sick employees to stay home
- Review policies and consider implementing new policies (see Q&A 13, below) to make sure that policies and practices are consistent with public health recommendations, as well as applicable laws
- Support respiratory etiquette and hygiene
- Increase environmental cleaning and disinfection
- Maintain a healthy work environment (for example, improving building ventilation systems)
- Does fear of contracting COVID-19 justify an employee’s refusal to work on-site?
An employee’s fear about contracting the virus will not typically justify a refusal to work, unless the fear is related to a serious health condition. In that circumstance, the employee could be eligible for traditional FMLA leave subject to the normal notice and certification process, but only if the underlying condition would independently be eligible for FMLA leave.
That said, while not likely, an employee could refuse to work if he/she has a good faith, reasonable, and demonstrable fear that they are in “imminent danger” of immediate death or serious physical harm. According to OSHA and as applicable to COVID-19, the following conditions must be met before a hazard becomes an imminent danger:
- There must be a threat of death or serious physical harm. “Serious physical harm” means that a part of the body is damaged so severely that it cannot be used or cannot be used very well.
- For a health hazard there must be a reasonable expectation that toxic substances or other health hazards are present and exposure to them will shorten life or cause substantial reduction in physical or mental efficiency. The harm caused by the health hazard does not have to happen immediately.
- The threat must be immediate or imminent. This means that the employee must believe that death or serious physical harm could occur within a short time, for example before OSHA could investigate and remedy the situation.
There also is the potential that employees could cite to the protections for “concerted” activity as a basis for refusing to work. Section 7 of the National Labor Relations Act (NLRA) extends broad-based statutory protection to employees who engage in “protected concerted activity for mutual aid or protection.” This protection, which applies in both union and non-union environments, include circumstances in which two or more employees act together to improve their employment terms and conditions and could encompass situations where employees participated in a “concerted refusal” to work in unsafe conditions. If this situation presents itself, we strongly recommend consulting legal counsel before taking any action.
- Can an employer discipline or terminate an employee who refuses to report to work from a generalized fear of contracting COVID-19?
Generally, an employer may discipline or terminate a worker who refuses to work (or return to work). While in ordinary circumstances this would be deemed a resignation and disqualify the individual from receiving unemployment benefits, it remains to be seen how unemployment agencies will handle such cases in the context of COVID-19.
- Does the previous answer change if the employee refused to return to work for one of the reasons identified in the “CARES” Act that provides eligibility for unemployment benefits?
Probably not. Eligibility for unemployment is a distinct issue from the right to discipline or terminate an individual. The Coronovirus Aid, Relief, and Economic Security Act (“CARES Act”) provides for Pandemic Unemployment Assistance (“PUA”) for individuals who certify that they are otherwise able and available to work (within the meaning of state law), but are unemployed, partially unemployed, or unable or unavailable to work for a wide range of reasons related to COVID-19. For more information about expanded eligibility for unemployment benefits under the CARES Act, please see our Alert dated March 30th on this topic. That said, employers should consider the practical “fall-out” from terminating an individual in such circumstances in terms of employee relations, social media about the company, and the like.
- What if the employee refuses to return to work because he or she is in a high-risk group, such as over the age of 65 or with an underlying health condition?
This is a complex subject as it requires balancing obligations and rights in a way that is highly dependent on the facts of the situation. In the case of an underlying health condition, an employer would be required to explore reasonable accommodations for an employee who refuses to report to work because of a health condition that meets the definition of a “disability.” In accordance with EEOC guidance, accommodations could include: increasing distancing or installing barriers that reduce the chances of exposure; elimination of marginal job duties; temporary transfers to a different position; or modifying a work schedule or shift assignment. Employers may also choose to place an end date on the accommodation. An employer may also grant an accommodation on a temporary basis until, for example, government recommendations on social distancing are relaxed. These situations are highly fact specific, and you should consult with legal counsel if this type of scenario presents itself.
- Can employees insist that they be allowed to continue working remotely?
In most circumstances, no. There could be situations, however, where an employer would need to consider work from home as a reasonable accommodation for a “disability” under the ADA or applicable state law. To date, neither the EEOC nor the Massachusetts Commission Against Discrimination has provided guidance as to whether either would consider COVID-19 to be a “disability,” in and of itself. It is likely that there will not be a single answer to this question, and it may well depend on the severity and longevity of the COVID-19 infection for an individual. Again, if this situation presents itself, you should consult legal counsel before taking action.
- May employers implement health screening protocols before allowing employees to return to the workplace?
Yes, to determine whether those entering the workplace would pose a direct threat to health in the workplace. Appropriate health screening protocols may include asking about symptoms, taking workers’ temperature, and conducting or requiring COVID-19 tests.
Symptom screening: Employers may ask all who enter the workplace whether they have exhibited COVID-19 symptoms. When asking about specific symptoms, employers should rely on the CDC, other public health authorities, and reputable medical sources for guidance on emerging symptoms associated with the disease.
Temperature taking: Although measuring an employee’s body temperature is generally considered to be a prohibited medical examination, because the CDC and state/local health authorities have acknowledged community spread of COVID-19 and issued attendant precautions, employers may measure employees’ body temperature. However, employers should be aware that some people with COVID-19 do not have a fever.
Employers that decide to take the temperature of those entering the workplace should consider various related logistical issues, such as: what type of device to use; who will be the temperature taker; what type of protective equipment should the temperature taker wear; and how to protect the health and confidentiality of the employees being tested.
COVID-19 testing: Yes. Although a COVID-19 test will be deemed a “medical test” and therefore it must be “job related and consistent with business necessity,” the latest guidance from EEOC is such tests are permissible.
Employers of course should ensure that the tests are accurate and reliable. For example, employers should review guidance from the FDA about what may or may not be considered safe and accurate testing, as well as guidance from CDC or other public health authorities, and check for updates.
Employers may also ask that employees have a COVID-19 test taken elsewhere, with the results presented to the employer before entering the workplace. The employer will be required to pay for the test.
Antibody testing: There is no specific guidance yet regarding whether an employer can take or require an antibody test, although ultimately, as the science around antibody testing develops, this is likely to be subject to the same standard as a COVID test. At this time, however, there remains substantial medical debate about whether the presence of COVID-19 antibodies means that the person with the antibodies is immune and, if so, how long the immunity lasts. And, although the FDA has approved certain antibody tests under its “emergency use” authority, as of yet, these tests have not been subject to rigorous validation studies. Further, the presence of antibodies does not rule out that the individual with antibodies has a current COVID-19 infection. Given the uncertainty, we recommend caution in this area, and further consultation before implementing this form of testing.
For information about maintaining the confidentiality of the results of health screenings, see Q&A 11 and 12, below.
- May an employer who implements health screening protocols before allowing employees to return to the workplace limit the screening protocols to high-risk individuals?
Likely no. Limiting screening to individuals who otherwise are protected by anti-discrimination laws, such as individuals over a certain age, who are pregnant, or who have underlying medical conditions, will be viewed by the EEOC and similar state agencies as unlawful discrimination.
- If an employee has symptoms of COVID-19 such as a fever, chills, or other symptoms recognized by the CDC or other governmental health authorities, can an employer send the individual home and when can they return to work?
Yes. Although an employee has a fever or other symptoms common to COVID-19, employers may (and should) send the employee home.
Current CDC guidelines indicate that individuals with COVID-19 who have self-isolated may leave isolation after having no fever for 72 hours without the use of fever-reducing medication, other symptoms have improved, and 7 days have passed since symptoms first developed. The most common period of time before an individual should return to work is, therefore, 14 days. We are unaware of any guidance from the CDC that directs how long an individual should self-isolate after having a fever but experiencing no other symptoms of COVID-19.
- May employers discipline employees who fail to follow employer-imposed safety policies/guidelines (including refusing to allow health screening)?
Yes, but of course discipline should be implemented in a manner unrelated to any protected status. For example, an employer may not discipline a “high-risk” individual (i.e., an older worker or one with an underlying medical condition) who refuses to follow safety guidelines, but not respond in a similar manner to an employee engaged in the same conduct who is deemed “low risk.”
- May an employer maintain records relating to health screening and, if so, how should these records be maintained?
Employers may- and should- maintain records of health screenings, including an employee’s statement that they have or suspect they may have the disease, or the employer’s notes or other documentation from questioning an employee about symptoms. However, as is required under the ADA, all medical information about a particular employee should be stored separately from the employee’s personnel file, and access should be limited.
- May an employer disclose the name of a worker who tests positive for COVID-19?
The answer to this is complicated, as the ADA and FMLA both prohibit the disclosure of information regarding the medical condition or history of an employee. Accordingly, many advisors recommend that employers disclose that a co-worker or visitor to the workplace has tested positive or been exposed to COVID-19 without disclosing any identities.
This unfortunately can conflict with efforts to control the potential spread of COVID-19. It is important from a public health perspective that those who have been in close contact with a person infected with COVID-19 be given sufficient information so they can take precautions to minimize the risk posed to themselves and others with whom they have close contact. We recommend that an employer seek permission from an infected individual to disclose his or her identify; if permission is refused, the employer should consider whether the public health benefit outweighs the risk. Consulting with legal counsel in such situations is strongly advised.
An employer also should ask an employee who has tested positive for COVID-19 for a list of all individuals with whom he or she came into contact in the workplace over the prior 14 days, as well as office areas and shared spaces visited. The fact that another individual has potentially been exposed should then be disclosed to anyone in the workplace who may have had contact with the infected individual, or who may have visited the same spaces within the offices over the prior few days (without necessarily disclosing the identity of the infected individual).
- What policies should employers consider implementing or updating as employees begin to return to the workplace?
Employers should review current policies and practices and/or implement new policies and practices, consistent with public health recommendations and applicable laws, relating to the following topics:
- Sick leave.
- Flexible work arrangements. This includes alternate worksites (telework), hours (staggered shifts), and meeting and travel options.
- Health and workplace safety standards, including physical layout (separating work-spaces to maintain distance), environmental controls, and personal protective equipment.
- Stagger scheduled breaks and presence in common areas (cafeterias).
- Are the circumstances of the pandemic relevant to whether a requested accommodation can be denied because it poses an undue hardship?
In general, an employer does not have to provide a reasonable accommodation if doing so poses an “undue hardship,” which means “significant difficulty or expense.” However, it is becoming clear that this concept, which has been interpreted narrowly and strictly by the EEOC and courts, will be applied more flexibly in the COVID context. The EEOC itself has published guidelines reflecting that an accommodation that would not have posed an undue hardship outside of the pandemic may pose one now. For example, EEOC has reflected that it may be significantly more difficult now to conduct a needs assessment or to acquire certain items, and delivery may be impacted, particularly for employees who may be teleworking. Similarly, EEOC has noted that it may be significantly more difficult to provide employees with temporary assignments, to remove marginal functions, or to readily hire temporary workers for specialized positions. Also, prior to the COVID-19 pandemic, the EEOC and courts typically found that most accommodations do not pose a significant expense when considered against an employer’s overall budget and resources. But, even the EEOC concedes that the sudden loss of some or all of an employer’s income stream because of this pandemic is now relevant, as are the availability of discretionary funds. If a particular accommodation poses an undue hardship, employers and employees should work together to determine if there may be an alternative that could be provided that does not pose such problems.
By Bello Welsh LLP
As described in detail in our prior Alert, the federal government signed into law the Families First Coronavirus Response Act (FFCRA) to help workers impacted by the current COVID-19 health emergency. Under the FFCRA, employees of businesses of fewer than 500 employees may be eligible for paid sick leave or paid family leave under certain COVID-19-related circumstances.
There are two types of paid leave available under the FFCRA—emergency paid sick leave and emergency paid family and medical leave (“E-FMLA”). Click on the links for a summary of the Department of Labor’s guidance and for Q&A.
Emergency Paid Sick Leave Act (“EPSLA”)
EPSLA leave is available to all employees, regardless of tenure. Employees are eligible for this leave if they meet one of the following conditions:
- They are subject to a federal, state or local quarantine or isolation order related to COVID-19;
- They have been advised by a health care provider to self-quarantine due to concerns related to COVID-19;
- They are experiencing symptoms of COVID-19 and are seeking a medical diagnosis;
- They are caring for an individual who is subject to a quarantine or isolation order or has been advised by a health care provider to self-quarantine;
- They are caring for a child because the child’s school or place of care is closed or the child’s care provider is unavailable due to a public health emergency; or
- They are experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor. No such specifications have yet been published.
If there is work available for an employee, but that employee cannot work (either in the office or remotely), that employee is entitled to EPSLA. Importantly, an employee’s entitlement to and use of paid sick leave may not be used to reduce or eliminate any other right or benefit to which the employee is entitled under any law, collective bargaining agreement, or employer policy that existed prior to April 1, 2020 (the effective date of the FFCRA). In other words, EPSLA cannot count against an employee’s balance or accrual of any other source or type of leave. Moreover, employers and eligible employees may agree (where Federal or state law permits) to have paid leave supplement EPSLA pay so that the employee receives up to the full amount of his or her normal pay. EPSLA leave also cannot be used retroactively – the law does not establish any right or entitlement to be paid for any unpaid or partially paid leave taken before April 1, 2020, even if that leave was taken for one of the six qualifying reasons listed above.
Emergency Family and Medical Leave Expansion Act (“E-FMLA”)
This leave is available to all employees who have been employed for at least 30 calendar days (including, in certain instances, rehired employees). An employee is eligible for up to twelve weeks of E-FMLA leave if he or she is unable to work (either at the employer site or remotely) in order to care for a child because the child’s school or place of care is closed or because their child’s childcare provider is unavailable due to the public health emergency (reason #5, above).
E-FMLA benefits run concurrently with EPSLA leave. This means that if an employee takes two weeks of EPSLA leave to care for a child (under reason #5), the employee would be eligible to take an additional ten weeks of paid E-FMLA leave. If, on the other hand, the employee took EPSLA leave for one of the other qualifying reasons, he or she would still be eligible for up to twelve weeks of E-FMLA leave; however, the first two weeks of the E-FMLA leave would be unpaid, unless the employee had accrued paid leave that could be used during that period. If accrued leave was available, the employer and employee may agree to allow the employee to use accrued paid leave during that two-week period.
Thereafter, for the remaining period of E-FMLA leave, the employee may choose, and the employer may require, that accrued leave be used concurrently with E-FMLA leave. In that instance, the employee must be paid the full amount to which he or she is entitled under existing paid leave laws or policies for the period of leave taken, up to 100% of regular pay (and the employer may claim the tax credit available under the FFCRA, even if the paid time off comes from the employee’s accrued leave bank). If accrued leave is exhausted before the end of the E-FMLA benefits period, the employer must pay at least the required E-FMLA amount (which is capped at $200 per day).
Importantly, employees are only entitled to a total of twelve weeks of FMLA leave per the employer’s FMLA year, including E-FMLA, so if an employee has already taken some or all of his or her FMLA leave, their available E-FMLA leave will be reduced by the amount taken. An employee is still eligible for the two weeks of paid sick leave, however, even if he or she has taken all twelve weeks of FMLA leave.
E-FMLA benefits will end on the earlier of the date on which the public health emergency ends or the employee receives full benefits under these laws.
 Of note, while the covered individuals are not limited to family members, the preamble to the DOL regulations states that “paid sick leave may not be taken to care for someone with whom the employee has no personal relationship. Rather, the individual being cared for must be an immediate family member, roommate, or a similar person with whom the employee has a relationship that creates an expectation that the employee would care for the person if he or she self-quarantined or was quarantined.”
 While the E-FMLA statutory text specifies that the child must be under 18 years of age, the EPSLA does not have this limitation, and both laws refer to the definition of “son or daughter” under the FMLA, which includes not only children under 18, but those over 18 who are incapable of self-care because of a mental or physical disability. The DOL has decided to interpret the E-FMLA and the EPSLA consistently with the FMLA.
By Bello Welsh LLP
The Families First Coronavirus Response Act (FFCRA), enacted on March 18, 2020, creates two new emergency paid leave requirements related to the COVID-19 pandemic: up to two weeks of paid sick leave and up to twelve weeks of expanded FMLA (e-FMLA) leave, ten of which are paid. Bello Welsh previously posted a summary of the FFCRA, available here.
On April 1, 2020, the United States Department of Labor (DOL) issued temporary regulations to implement the FFCRA’s leave entitlements. The regulations and supplementary information provided by the DOL (available here) clarify ambiguities in the FFCRA and provide further guidance to employers. While we will be providing further analysis of the regulations and their implications in the coming days, certain key provisions of the regulations are summarized below.
Documentation from Employees
Employees are required to provide, and employers must retain, documentation of the need for paid sick leave or e-FMLA. Regardless of the reason for leave, employees must provide the following:
- Employee’s name;
- Date(s) for which leave is requested;
- Qualifying reason for the leave; and
- Oral or written statement that the employee is unable to work because of the qualified reason for leave (if the employee provides an oral statement, the employer must document it and retain the documentation).
- An employee taking paid sick leave because s/he or an individual for whom s/he is caring is subject to a federal, state, or local government quarantine or isolation order must provide the name of the government entity that issued the order;
- An employee taking paid sick leave because a health care provider advised the employee or an individual for whom s/he is caring to self-quarantine due to concerns related to COVID-19 must provide the name of the health care provider;
- An employee taking paid sick leave or e-FMLA leave to care for a son or daughter whose school has been closed or whose childcare is unavailable due to COVID-19 must provide: (a) the name of the son or daughter being cared for; (b) the name of the school, place of care, or childcare provider that has closed or become unavailable; and (c) a representation that no other suitable person will be caring for the son or daughter during the period for which the employee takes paid sick leave or e-FMLA leave.
The employer may also require any other documentation necessary to support a request for tax credits under the FFCRA. Thus, to the extent the IRS issues guidance requiring additional documentation, employers should require employees to provide it. The IRS’s current guidance on FFCRA tax credits is available here. Notably, absent the IRS issuing guidance to the contrary, employers may not require doctor’s notes.
Employees or Family Members Particularly Vulnerable to COVID-19
Many employers have asked whether employees in high-risk categories (due to advanced age or underlying medical conditions) are entitled to paid sick time if they do not report to work for fear of contracting COVID-19 and are unable to telework. Under the regulations, the answer is yes, so long as the employee has been advised by a health care provider to self-quarantine based on a belief that the employee is particularly vulnerable to COVID-19 or a federal, state, or local government authority has advised categories of citizens (e.g., those of certain age ranges or with certain medical conditions) to shelter in place, stay at home, isolate, or quarantine. Employees must provide the documentation described above (including the name of the relevant governmental authority or health care provider) to substantiate the need for leave.
By contrast, an employee is not eligible for paid sick time because a member of his/her household or other close family/friend is in a high-risk category, unless: (1) the other individual depends on the employee for care; (2) the other individual has been advised by a government authority or health care provider to quarantine, self-quarantine, isolate, stay at home, or shelter in place; and (3) the employee is unable to work or telework due to the need to care for the individual.
An employee may take paid sick or e-FMLA leave if s/he is unable to work or telework as a result of the qualifying reason for leave. Telework is considered an option only if: (1) the employer has work for the employee; (2) the employer permits the employee to work from the employee’s location; and (3) there are no extenuating circumstances (including but not limited to serious COVID-19 symptoms) that prevent the employee from performing the work.
The DOL encourages employers to implement highly flexible telework arrangements that allow employees to perform work, potentially at unconventional times, while tending to family and other responsibilities, such as teaching children whose schools are closed for COVID-19 related reasons.
The regulations and supplementary information contain detailed guidance on the items discussed above and a number of other issues, including the scope of the qualifying reasons for which employees may take paid leave; the amount of leave and pay available for sick time and e-FMLA; employee eligibility criteria; employer coverage; intermittent leave; the interaction between paid sick leave, e-FMLA, and typical FMLA; employer and employee notice requirements; job protection for employees; and recordkeeping, including documentation required for purposes of obtaining the tax credit. Individuals responsible for implementing FFCRA leaves should consult the regulations and/or legal counsel to ensure compliance.
By Bello Welsh LLP
The Department of Labor’s Wage and Hour Division has issued materials providing guidance (the “DOL Guidance”) on the Families First Coronavirus Response Act (“FFCRA”). These materials, which include Q&A documents and fact sheets for employers and employees, can be found here. The same page also includes links to the notices that employers must post. For a detailed summary of the paid sick leave and Emergency FMLA provisions of the FFCRA, please refer to our earlier alert, available here. Read more
On Jan. 31, 2020, the U.S. Citizenship and Immigration Services (USCIS) published a new version of Form I-9: Employment Eligibility Verification. Although employers can and should begin using the new Form I-9 immediately, the old Form I-9 will not become obsolete until April 30, 2020.
Background. The law requires employers, certain agricultural recruiters and referrers for a fee (all referred to as “employers”) must verify the identity and employment authorization of each individual they hire for employment in the United States on Form I-9, Employment Eligibility Verification.
As described in a notice published by USCIS, Form I-9 collects identifying information about the employee (and preparer or translator if used), and requires the employee to attest to whether he or she is a U.S. citizen, noncitizen national, lawful permanent resident, or alien authorized to work in the United States. Form I-9 also collects identifying information about the employer and information regarding the employee’s identity and employment authorization. The employee must present original documentation evidencing his or her identity and employment authorization, which the employer must review.
Employers must maintain Forms I-9 for as long as an individual works for the employer and for the later of three years after the employee’s date of hire or one year after the date employment ends. Various government agencies, including the Department of Homeland Security, the Immigration Rights Section in the Department of Justice’s Civil Rights Division, and the Department of Labor, have right to inspect an employer’s Forms I-9. An employer’s failure to ensure proper completion and retention of Forms I-9 may subject the employer to civil money penalties, and, in some cases, criminal penalties.
Changes to Form I-9. The paper version of the new Form I-9 has not changed, but the electronic version has been modified, as follows:
- Added Eswatini and North Macedonia to the Country of Issuance and foreign passport issuing authority fields, to reflect these countries’ recent name changes
- Clarified who can act as an authorized representative on behalf of an employer
- Updated USCIS website addresses
- Provided acceptable document clarifications
- Updated the process for requesting the paper Form I-9
- Updated the DHS Privacy Notice
As always, please reach out to your regular employment lawyer with questions.
With the U.S. Department of Labor’s new overtime rule becoming effective in less than two months, on January 1, 2020, employers are well advised to be working now to implement any needed changes by the new year.
This fall, the DOL issued its final rule affecting pay requirements for exempt executive, administrative and professional employees (the so-called “white collar” exemptions) under the Fair Labor Standards Act (FLSA). The rule:
- Raises “standard salary level” required for the white collar exemptions to $684 per week (annualized to $35,568), up from the $455 per week level that has been in place since 2004;
- Raises the annual compensation requirement for “highly compensated employees” (those who have at least one exempt duty) to $107,432 per year, up from $100,000;
- Allows nondiscretionary bonuses and incentive payments (including commissions) to be used to satisfy up to 10% of the standard salary level, including in a one-time catch-up payment, if certain conditions are met; and
- Revises certain special salary levels applicable to workers in U.S. territories and the motion picture industry.
Employers that elect to transition currently exempt employees into overtime-eligible status, and decide to change from salary to hourly pay, will need to determine a method for setting the pay rate. While the “reverse engineering” method, which uses the current salary to arrive at an hourly rate, may address business needs in some cases, employers should note that use of this method may be constrained in states with stringent Equal Pay laws. Employers interested in using the 10% allowance to meet the new pay obligations are advised to consult with counsel before proceeding, as failure to meet the conditions in the new rule results in loss of the exemption and therefore liability for overtime pay.
Employers that decide to move forward with the shift from exempt to non-exempt status should plan ahead to address likely logistical and employee relations challenges, for example:
- Ensuring accurate recording and timely reporting of hours of work for a new cohort
- Ensuring compliance with meal and rest break requirements in certain states
- Changing wage payment timing, in states where non-exempt pay must be more frequent
- Devising appropriate messaging to deal with such issues as potential concerns of employees who view the change as a demotion or reduction in status, or who have questions about past practices
As a reminder, businesses must also comply with state and local overtime pay requirements and exemption standards. Where those standards already exceed the new FLSA levels, such as in New York, California, and Alaska, the new DOL rule will have little practical impact on exempt employees’ pay. More generally, however, companies should track overtime pay obligations on the state and local level to ensure these obligations are met as to non-exempt employees. For example, California, Colorado, and several other western states have daily (not just weekly) overtime pay requirements. In addition, some states do not recognize the same exemptions from overtime as are available under the FLSA, while others apply different duties tests when determining whether an exemption applies.
While the DOL rule appears fairly simple at first glance, it can raise complicated compliance issues, which should be considered carefully before changes are implemented. At the same time, employers that have been considering changes to employee classifications may find this is a logical time to implement them. Your Bello Welsh, LLP counsel is available to advise you on these matters and to work with you to determine available options, assess legal and business risk, and implement an agreed plan.
BELLO / WELSH LLP CONTACT INFO
Bello / Welsh LLP
125 Summer Street,
Boston, MA, 02110